SINGAPORE (Nov 23): Capital markets across Southeast Asia have raised a total of $10.4 billion in 144 initial public offerings (IPOs) in the year up to mid-November – the highest amount raised in the region since 2014.
Mainboard-listed Netlink NBN Trust leads the way, with some $2.45 billion raised in its IPO on the Singapore Exchange (SGX) in July – more than double of the second-highest amount raised in the region.
Malaysia’s Lotte Chemical Titan Holding ranked second with some $1.2 billion raised in its IPO on Bursa Malaysia in July.
According to Deloitte Singapore, the record-high capital raising activity in 2017 so far reflects positive listing decisions and investor confidence in Southeast Asian exchanges.
“Against a healthy global backdrop and resilient domestic demand that supports growth with Southeast Asia’s GDP forecasted at 5.1% — way exceeding the Global GDP forecasted at 2.7%, we can expect the markets to remain dynamic and attractive to investors,” says Dr Ernest Kan, Global IFRS & Offerings Services Leader, Deloitte Southeast Asia.
The promising trend is expected to continue into 2018 with the liberalisation of China’s foreign investment policy, as well as the steady rise of REITs and Business Trusts in each of the Southeast Asian markets, he adds.
Leading the charge in Southeast Asia is the SGX, which has seen 15 deals so far this year, nearly surpassing the 16 deals in the whole of last year. Deloitte expects Singapore’s IPO market to close the year with more than 20 IPOs.
Already, the total amount of funds raised at $3.7 billion so far in 2017 is the highest in four years.
Compared to 2016, the amount raised this year has climbed 61.8% and IPO market capitalisation has increased by 49.1%.
“Liquidity in Singapore’s equity market remains high as there were more IPOs with public offer tranche in the last 10.5 months,” says Tay Hwee Ling, Global IFRS & Offerings Services Leader, Deloitte Singapore.
“Of the 15 IPOs to date, there were ten public subscriptions and all were oversubscribed at a median of 32 times and an average of 103 times,” she adds.